Walmart targets NY sites on QT

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The 630,000-square-foot Gateway II shopping center off Jamaica Bay in Brooklyn is among the sites Walmart is eyeing in a renewed push to build its first New York City store, sources familiar with the situation say.

Union leaders, fearful of a potential Walmart deal at the Related Cos.-owned site near Spring Creek Towers, are planning a protest in the next 10 days, but so far both the Arkansas-based retail giant and the developer insist there is nothing to announce.

“We know that New Yorkers want to shop and work at Walmart, and as a result, we continue to evaluate potential opportunities here,” says Steven Restivo, the company's director of community affairs. “New Yorkers want quality jobs and affordable groceries, and it remains our goal to be part of the solution.”

A Related spokeswoman would say only that the company has not signed any leases for Gateway II. The developer has already successfully shepherded the shopping center through the city's land-use process, gaining approval last summer.

The site, which is currently vacant, meets many of the parameters of what Walmart is looking for in a New York City location: an as-of-right location in an outer borough, with a low-income population nearby and pent-up demand for jobs and supermarkets. Walmart is believed to be examining other unspecified sites in the outer boroughs as well.

The company's attempts earlier this decade to open outlets in Queens and on Staten Island were thwarted by labor unions and community groups worried that the chain's low prices and modest wages would eat into the market share of unionized retailers like Pathmark, Key Food and Duane Reade and put mom-and-pop shops out of business. That organized effort led then-CEO H. Lee Scott to say that opening a Walmart store in New York City was not “worth the effort.”

Avoiding City Council's stamp

But earlier this year, Walmart officials told Crain's the retailer was restarting its search for a New York City location. Now that quest appears to be gaining momentum. Observers say the company has been on the lookout for an as-of-right site because gaining approval from the many City Council members dependent on union support would be extraordinarily difficult.

Plus, Walmart would need a local developer that doesn't have major projects before the council that members might sacrifice in protest against Walmart. Related would seem to fit that bill, since its Hudson Yards project was approved and its Kingsbridge Armory plan was shot down by the council late last year.

“If the theater of the land-use approval process is not available to opponents, I don't think there's another easy way to mount a campaign against them,” says Kathryn Wylde, president of the Partnership for New York City, of which Walmart is a member.

The company could face opposition from tenants in its Gateway I complex, including BJ's Wholesale Club and Target, which might worry about increased competition.

And it is sure to see resistance from its longtime New York City foes—who were readying for battle last week.

Protest is planned

“We don't like how they treat workers as it relates to salaries and benefits, and we're not going to have them in our community,” says City Councilman Charles Barron, D-Brooklyn. “They will have the fight of their lives.”

United Food and Commercial Workers Local 1500 is planning a protest in the next week and is already arguing that Related's earlier traffic study presented to gain land-use approval did not take into account a Walmart being situated in Gateway II. The union is planning to send canvassers out to the neighborhood to drum up opposition to a potential Walmart.

“Walmart was never, ever mentioned once through the entire land-use process,” says Pat Purcell, assistant to the president of UFCW Local 1500. “The area cannot sustain a Walmart, a Target and a BJs. In this area, it's a job killer; it's just the wrong use.”

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